In response to our 2006 report, the Department of Health has implemented a new provider rate structure for the Early Steps Program. The department also plans to implement a family cost-sharing system as part of a project to use a third-party administrator for billing. The department has modified its area office contracts to include data timeliness and provider monitoring standards. However, the department has not yet implemented sanctions for noncompliance with data entry timeframes and the monitoring requirements are not sufficient to ensure that providers are adequately monitored.

Despite efforts to better maximize federal funding, the program continues to accrue unspent federal funds due to differences between budget authority and federal grant amounts and a decline in child participation. The department has attempted to increase participation through revised provider rates and increased public outreach, and needs to assess the outcomes of its outreach efforts.

What were our earlier findings?Report No. 06-14 Early Steps Faces Service Challenges; Has Not Used All Available Federal Funds, published in February 2006.